He has completed most of the procedures for going to work in Taiwan next month, but has not managed to raise enough money to pay for the trip.

"Earlier, many people in my village were able to borrow bank loans for working abroad. However, it has become much more difficult to do so now," said the 24-year-old native of Nam Dinh Province. "I have asked three banks, but none of them have agreed to lend me the money."

Without the VND100 million (US$5,000) or so he needs to pay for commission, documentation and travel expenses, Nam's trip may be cancelled. Thus, he may lose all the spending he'd done on foreign language and vocational training courses with the aim of being able to find work abroad.

Nam is one of many laborers caught in a quagmire because banks are not interested in giving the loans.

Over 100 workers registered to go abroad through labor exporter Airseco have received visas and are scheduled to fly this month, but have not been able to leave because of insufficient funds.

Nguyen Xuan Vui, general director of Airseco, said, "Over the past three months, the workers have not been able to access bank loans from the Vietnam Bank for Social Policies or the Vietnam Bank of Agriculture and Rural Development as these banks are facing a capital shortage."

He said his firm has not yet confirmed with its foreign partners whether it can send enough workers as scheduled. "Most of the workers are poor, so they cannot bear interest rates offered by loan sharks that are much higher than the 21-25 percent offered by banks."

Dang Huy Hong, general director of labor export firm Sona, said his firm sends workers mainly to Malaysia, which only involves fees of about VND20-30 million, so some of the workers have been able to borrow this money from their relatives and/or friends.

However, several others who were unable to borrow from banks or relatives, have had to cancel their trips, he said. "Bank loans seem impossible to get, as the lenders put up too many requirements."

Exporters who send workers to markets that require high processing fees of between VND70 million and VND150 million, such as Japan and South Korea, are seeing more people cancel their trips because of their failure to access bank loans, Hong said.

Vice chairman of the Vietnam Association of Manpower Supply, Nguyen Xuan An, said the country may fail to fulfill the target of sending 85,000 laborers abroad this year if the workers still face difficulties in borrowing from banks for a longer time.

The association has asked the Vietnam Bank of Agriculture and Rural Development to facilitate laborers in accessing loans. However, this depends on the bank's success in capital mobilization. It can offer favorable conditions for customers only when it has a stronger capital supply, he said.

Scant support

Nguyen Van Ly, deputy general director of the Vietnam Bank for Social Policies, confirmed that the banks were constrained by a lack of capital to provide loans to workers. The government has set aside a smaller amount of capital for lending to workers wanting to go abroad so it could spent on supporting poor students, he said.

Representatives of other banks said they'd also cut lending to customers wanting to take loans for getting work contracts abroad because of a capital shortage as well as the high rate of bad debts.

"We are negotiating with foreign employers an arrangement where they agree to lend money to the workers and deduct it from their salaries," said Vui of Airseco. "However, this is a temporary measure, because foreign employers would not have the capital to offer loans to many workers."

If the workers are unable to go abroad, labor exporters would also suffer as they would have spent a lot on sending staff abroad to seek contracts with foreign partners, and on training workers for their assignments abroad, he said.

Vietnam sent 37,700 laborers to work abroad in the first five months of this year, mainly to Taiwan, South Korea and Malaysia and Japan. Taiwan was the biggest market, attracting over 14,000 Vietnamese laborers, followed by South Korea with over 9,000, according to the Vietnam Association for Manpower Supply.